Monday, October 31, 2011

Thinking of sending your employees to healthcare exchanges? Not so fast.

Many employees are worried that, starting in 2014, their employers will deem it cost effective to stop offering healthcare insurance to employees, and that they will, instead, tell their workers to just sign up for health coverage through the Patient Protection and Affordable Care Act's (ACA's) newly-created healthcare exchanges.According to a recently-issued press release, CVS Caremark's executive vice president and chief medical officer Troyen A. Brennan, MD, MPH, thinks that companies would be short-sighted to discontinue healthcare coverage for employees. He urged attendees of the National Business Group on Health's (NBGH's) annual meeting last week to consider continuing company-sponsored health and wellness plans.

Brennan seems to view employer-sponsored insurance as a way for companies to maintain some control over their employee's health, and, ultimately, their work output. "The decision you make regarding how to manage your employees' health care moving forward is important for your employees and your business," Brennan was quoted as saying, adding, "Do you stay in the driver's seat and proactively manage the health and productivity of your workforce, or do you climb into the back seat and take your chances?"

Brennan, a former professor of medicine, law and public health at Harvard University who formerly served as president and CEO of Brigham and Women's Physician Organization and chief medical officer of Aetna Inc. before joining CVS Caremark, focused during his presentation on 25 years of peer-reviewed research studies of health and wellness programs in the workplace, and the impact on medical costs of those programs.

Successful programs, according to Brennan, "are run by companies where the leadership fully supports developing a healthy culture," adding that, "...employers need to use all the tools at their disposal - web, telephone, incentives and face-to-face counseling - to encourage healthy individual behaviors."

Brennan pointed to recent research into health care savings resulting from aggressive smoking cessation and weight loss programs that showed potentially dramatic cost savings for employers. For example, one such study projected savings in excess of $7 billion over 10 years. Brennan conceded, however, that other studies have sometimes produced mixed results when it comes to medical cost savings projections. Still, "absenteeism and productivity go to the bottom line," he said.

Brennan also reviewed projections from such entities as the Congressional Budget Office, Rand Corporation, Urban Institute, Goldman Sachs, the Lewin Group, Deutsche Bank and CVS Caremark on the impact the ACA will have on the health care market. The nation's uninsured population will drop significantly as a result of the health care reform law, the projections showed, but the future of employee-sponsored health plans was less clear. Some predicted that employee-sponsored health coverage would dwindle, while others show slight growth. It remains to be seen how all of this will play out in 2014, but, hopefully, employers will be at least willing to consider keeping their health and wellness offerings to employees for the near future.

For more information. For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.


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